Medicare targets drug overpayments to hospices


WASHINGTON — New Medicare guidance taking effect Thursday aims to stop the federal government from paying millions of dollars to hospice organizations and drug insurance plans for the same prescriptions for seniors. But the changes may make it more difficult for dying patients to get some medications, senior advocates and hospice providers say.

The new measures direct insurers not to pay for any prescriptions for hospice patients until they receive confirmation that the drugs are not covered instead by the hospice provider.

Requiring additional authorization for these prescriptions will “prevent duplicate payments for drugs covered under the hospice benefit,” Medicare officials told hospice providers and insurers in a conference call three weeks ago.

Medicines for Medicare patients receiving hospice care generally are paid in two ways. Drugs related to palliative and comfort care are supposed to be covered under the fixed-rate federal payments to the hospice. Drugs for diabetes, heart disease or other chronic conditions still used by such patients but not directly related to their terminal illness are covered by Medicare Part D prescription drug plans. Those plans are heavily subsidized by Medicare.

Medicare officials said in the conference call that the new measures are a response to a 2012 investigation that found Part D prescription drug plans paid more than $33 million in 2009 that probably should have been covered by the hospice benefit. That was for analgesic, anti-nausea, laxative and anti-anxiety drugs, as well as prescription drugs used to treat pulmonary problems and amyotrophic lateral sclerosis (ALS), also known as Lou Gehrig’s disease. Beneficiaries paid nearly $4 million in copayments, the Department of Health and Human Services’ inspector general report found.

Though the drugs were prescribed to beneficiaries during the time they also received hospice care, drug plans did not know if hospice groups should have paid for those prescriptions instead, the report said.

About 1.1 million Medicare beneficiaries received hospice care in 2009, and 437,121 filled prescriptions through their Medicare drug plan, the report said.

Instead of leaving it to insurers and hospice providers to sort things out, the new rule sets up a process that requires Part D plans initially to reject any prescription from a hospice patient. The patient or doctor, with the hospice provider’s agreement, must explain to the insurer why the drug is not related to end-of-life care. The insurer may deny coverage for a number of reasons, including if the doctor or hospice did not offer a sufficient explanation, Medicare officials said.

Clare Krusing, a spokeswoman for America’s Health Insurance Plans, an industry trade association, said, “Part D sponsors will continue to work with hospice providers to make sure patients understand the coordination of benefits under Part D and hospice when electing hospice care.”

In their announcement of the new process, Medicare officials conceded that in the past the government’s guidance “was ambiguous and there were no objective criteria for Part D sponsors to apply in making Part D versus [hospice] coverage and payment determinations.”

The new payment process, proposed in March and already in use in some areas, is causing some hospice patients or their families to leave their pharmacies empty-handed.

“We had a couple of patients who went in to get their cardiac medications and were denied,” said Susan Strauss, a registered nurse and chief compliance officer at Hope Health Inc. in Hyannis, Mass.

“Denying people cardiac meds — or the medication they need to breathe easier — that they have had for 30 years and is unrelated to their hospice diagnosis is causing them more pain, more anxiety and puts them at greater risks for more emergency room visits and hospitalizations,” Strauss said.

If the Part D plan refuses to cover a prescription, hospice patients or their authorized representatives will need a doctor’s help to request an expedited appeal from Medicare to improve their chances of success, said Terry Berthelot, a senior attorney at the Center for Medicare Advocacy, which offers more details on its website at www.medicareadvocacy.org.

If the doctor says the patient’s health is in immediate jeopardy, a decision is supposed to be made within 24 hours. If that fails, there is an appeals process, she said.

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Kaiser Health News is an editorially independent program of the Kaiser Family Foundation.